Retail chain Toys R Us is reportedly close to reaching an agreement with the pensions lifeboat to save its UK stores.

The beleaguered chain, which has stores in Norwich and Ipswich, had been told to pay £9m towards a £25m to £30m pension scheme shortfall today by the Pension Protection Fund (PPF) or face administration. It is believed the company was unable to do this with its American parent company filing for bankruptcy protection, preventing it from diverting funds to the UK.

However, reports have emerged that a deal is close to being struck between the two parties.

Creditors and the PPF will vote on proposals for a company voluntary arrangement (CVA) which would see 26 stores across the UK closed.

The Ipswich store was named in the tier of top-performing shops, while Norwich was in the third of five groups, meaning it needed to secure a rent reduction of at least 35% within seven months of a CVA or face closure.

CVAs allow businesses with debt problems to make an agreement with creditors over the repayment of some or all of their debt.

Should Toys R Us collapse 3,200 jobs would be lost across the UK.

The PPF’s tough stance comes after heavy criticism for failing to better protect pensioners at BHS.

Commons Work and Pensions Select Committee chairman Frank Field has also voiced concerns on the Toys R Us saga, while also raising questions over bonus payments to top bosses.